Jewelry maker Tiffany is out with earnings that have matched expectations, but which warn of a slowdown ahead.In fact, the slowdown is already here.
- Sales in the Americas region declined 1% to $434 million in the second quarter and rose 1% to $820 million in the first half. On a constant-exchange-rate basis, total sales were unchanged in the quarter and rose 2% in the half; on that basis, comparable store sales declined 5% in the second quarter and 3% in the first half (sales declined 9% and 7% in the New York flagship store while comparable branch store sales declined 4% and 2%). In last year’s second quarter, comparable store sales on a constant-exchange-rate basis had increased 41% in the New York flagship store and 19% in branch stores. Combined Internet and catalogue sales in the Americas rose 3% in the second quarter (on top of a 16% increase last year) and 2% in the first half.
- In the Asia-Pacific region, total sales rose 1% to $174 million in the second quarter and 8% to $369 million in the first half. On a constant-exchange-rate basis, total sales increased 3% and 9% in the quarter and half, while comparable store sales declined 5% in the quarter (on top of a 41% increase last year) and rose 2% in the half, due to mixed performance across the region.
That’s a dramatic slowdown in Q2 sales, from growth of 8% for the half, to just 1% in the second quarter. It’s a tad better if you exclude the impact of currency fluctuations, although that just underlines how much the strong dollar is depressing corporate earnings.
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